Yeah, tech growth is slowing down


Shares of Amplitude, Airbnb and Twilio are down sharply this morning following their earnings results yesterday.

It might sound odd to group these corporations together given the various sectors they operate in: Amplitude does digital product analytics, Airbnb provides a marketplace for consumer lodging rentals, and Twilio sells communications services for software products via APIs. What could they’ve in common?

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The reply appears to be their growth forecasts for the 12 months, which got here in below what Wall Street hoped for.

While we were lower than impressed with how slowly the biggest American tech corporations are expanding their revenue, it appears we’re not coping with a difficulty that only impacts Big Tech. Their smaller peers are seeing similar headwinds, too.

This morning, we’ll go over each company’s results after which we’ll hear from Amplitude CEO Spencer Skates, whom we spoke to yesterday. Lastly, we’ll take a look at a broader index of recent software corporations’ growth rates and put all that together to glean takeaways for startups.

The (financial) road ahead

Airbnb needs no introduction, so we will jump straight to the numbers. The corporate reported better-than-expected revenue and its first GAAP profit within the quarter, while also generating fistfuls of money. It actually seems like an excellent result, especially on condition that revenue expanded 20% at Airbnb’s age on this economy.

Nevertheless, Airbnb expects revenue to extend by 12% to 16% within the second quarter from a 12 months earlier. That’s quite a bit lower than the 58% growth it saw in Q2 2022, and it’s also a decline from the 20% it grew in Q1 2023. Investors did not like that forecast.

As for Twilio, it reported better-than-expected profit and revenue for the primary quarter, but its revenue forecast of $980 million to $990 million for the second quarter, or growth of just 4% to five%, left investors unsatisfied, especially as analysts were expecting a far greater $1.05 billion in revenue.


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